Abstract

With target date funds widely expected to account for more than 50% of all defined contribution assets in the near future, it is difficult to overstate their importance on the retirement security of America. Yet there are very few tools and statistics for monitoring and evaluating target date funds. This article highlights a previously unrecognized characteristic of target date fund families: Glide paths aren’t necessarily stable over time, and in some cases change dramatically. We document
the stability, or lack of stability, of the glide paths for the largest target date fund families and introduce quantitative measures of glide path stability, including our preferred measure, the Glide Path Stability Score.